Rental Ground

Ground rent dates back to the 18th century when the ground rent system kept original home ownership costs low.  This was because the buyers only paid for the building and just rented the land at a fixed additional cost.
 

Rental ground, usually referred to as “ground rent” is a common part of the residential real estate market.  The term is generally described as you own the house, but the property that the house is on is owned by someone else.  Therefore you will pay the owner of the land rent on that land.  It is often common that if you do not own the ground rent you can easily purchase it.
 

The individual that owns the home on the property with a ground rent least will pay the ground rent fee.  Average costs of these fees in most cases can range from $50 to $150 annually and is a fee that is paid in two installments per year.  


 

When a property is listed for sale on the “Multiple Listing Service,” the property explanation should indicate if the ground rent is applicable – “fee simple”.  This means you’ll own the house and the ground when paying the purchase price.  While “ground rent” means you’ll pay a fee to the owner of the ground.
 

Homeowners must be given all the information necessary from ground rent owners to redeem or purchase the ground rent now a days.  These notices will be provided with each ground rent bill the homeowner receives.  In addition, homeowners must be given notice in regards to redeeming the ground rent as part of the initial financing or refinancing of the property.  Other similar information as well is also required to be disclosed in a contract of a sale.